You might not be able to manipulate the files once they're downloaded. Is there a setting in the YouTube app to choose the default storage location? If so, can you change it to SD and re-download the video?
I don't have a microSD card in the phone yet. I'm asking around to see exactly what can be kept on the card before I go and invest in on. I know this much: the files are stored as mp4s and they do work in offline mode. Thank you for your reply.
They can be downloaded right to the SD card. Here are the options. As for moving previously downloaded files per phone you can't do that IIRC. They're encrypted to work only with the app and that phone (or something of that nature).